Generally you want to see a breakout be confirmed with an increase in volume and internals (such as Breadth) – if so, it increases the odds that the breakout will succeed and we can profit from a breakout price impulse.

If, however, price breaks out but nothing else pushes to new highs… and indicators form lower highs (divergences), it increases the odds that the breakout will fail and a “trap” will play out to the downside.

Today’s session unhinged the market from the highs, and we’re seeing the initial sell-swing take price back under the breakout level (2,114).

Price is in a movement “down away from” the prior high and the prior breakout level and our trading strategies will reflect this new – expected – development.

Here’s the move playing out on the four-futures grid:

The S&P 500 futures failed into the 2,130 level on today’s breakdown under 2,120.

The Dow Jones futures failed into 18,300 and broke impulsively under the 18,200 support.

The NASDAQ futures failed into 4,540 and broke 4,520 to trigger a trend day.

Finally, the Russell 2000 futures contract failed into 1,260 and triggered a break today under 1,250.

Focus on these levels and the movement lower toward lower price support target levels.

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